Midcarolina Financial (MCFI) 8-K MidCarolina Financial Corporation Announces 42% Increase in 1st Quarter Net Income Available to Common Shareholders

Exhibit 99.1

Press Release

April 21, 2006

SOURCE: MidCarolina Financial Corporation

Contacts:	Randolph J. Cary, Jr.
	President and CEO
	Phone Number: 336-538-1600
	Chris Redcay
	Sr. Vice President and CFO
	Phone Number: 336-538-1600
Source:	MidCarolina Financial Corporation

MidCarolina Financial Corporation Announces 42% Increase in 1st Quarter Net Income Available to Common Shareholders

BURLINGTON, N.C., /PRNewswire-FirstCall/ — MidCarolina Financial Corporation (OTC Bulletin Board:MCFI -News) today reported operating results for the first quarter ended March 31, 2006. MidCarolina reported net income available to common shareholders of $710,000 for the quarter ended March 31, 2006, an increase of 42% when compared to the $500,000 reported for the first quarter of 2005. Diluted earnings per common share increased to $0.21 for first quarter 2006, compared to $0.15 in 2005.

MidCarolina reported total assets of $398.1 million at March 31, 2006, an increase of $91.5 million, or 30%, when compared to the $306.6 million reported at March 31, 2005. Total loans, net of mortgage loans held-for-sale, were $301.8 million at March 31, 2006, an increase of $67.4 million, or 29%, from levels at March 31, 2005. Deposit totals at the end of the quarter were $324.3 million, an increase of $76.3 million, or 31%, when compared to 2005 quarter-end balances.

Commenting on these results, Randolph J. Cary, Jr., President and CEO, said, “The Board of Directors and management are very pleased to report record operating results for the first quarter of 2006. We are very proud of the growth MidCarolina achieved in our existing markets of Alamance and Guilford counties. Our client base continues to expand as commercial and retail businesses choose MidCarolina as their financial partner.”

MidCarolina Bank provides a complete line of banking services to individuals and businesses through its five full-service banking offices and two limited-service offices located in the cities of Burlington, Graham and Greensboro, North Carolina. MidCarolina Bank, a wholly owned subsidiary of MidCarolina Financial Corporation, also provides the Bank’s markets with personalized full brokerage services for stocks, bonds, mutual funds and an array of insurance products.

MidCarolina Bank is insured by the FDIC and is an equal housing lender.

This press release contains forward-looking statements as defined by federal securities laws. These statements may address issues that involve significant risks, uncertainties, estimates and assumptions made by management. Actual results could differ materially from current projections. For further information and other factors which could affect the accuracy of forward-looking statements, please see MidCarolina’s reports filed with the Securities and Exchange Commission pursuant to the Securities Exchange Act of 1934 which are available at the SEC’s website (www.sec.gov) or MidCarolina’s website

(www.midcarolinabank.com). Readers are cautioned not to place undue reliance on theses forward-looking statements, which reflect management’s judgments only as of the date hereof. MidCarolina Financial Corporation undertakes no obligation to revise these statements following the date of this press release.

PERFORMANCE SUMMARY

MIDCAROLINA FINANCIAL CORPORATION

(Dollars in thousands, except per share and share data)

	For the Three Months Ended March 31,						% Change
	2006 (Unaudited)			2005 (Unaudited)
SUMMARY STATEMENTS OF OPERATIONS
Interest income	$	6,098		$	3,835		59.0	%
Interest expense		2,957			1,504		96.6	%
Net interest income		3,141			2,331		34.8	%
Provision for loan losses		232			271		-14.4	%
Net interest income after provision for loan losses		2,909			2,060		41.2	%
Noninterest income		494			789		-37.4	%
Noninterest expense		2,135			2,091		2.1	%
Income before income tax expense		1,268			758		67.3	%
Provision for income taxes		454			258		76.0	%
Net income		814			500		62.8	%
Dividends on preferred stock		(104	)		—		—
Net income available to common shareholders	$	710		$	500		42.0	%
PER SHARE DATA
Earnings per share, basic	$	0.23		$	0.16		43.8	%
Earnings per share, diluted		0.21			0.15		40.0	%
PERFORMANCE AND ASSET QUALITY RATIOS
Return on average assets		0.87	%		0.68	%
Return on average common equity		15.24	%		11.96	%
Net yield on earning assets (taxable equivalent)		3.52	%		3.40	%
Average equity to average assets		6.28	%		5.70	%
Allowance for loan losses as a percentage of total loans, end of period		1.44	%		1.34	%
Non-performing assets to total assets, end of period		1.02	%		0.69	%
Ratio of net charge-offs to average loans outstanding		0.00	%		0.00	%
	As of March 31,						% Change
	2006 (Unaudited)			2005 (Unaudited)
SELECTED BALANCE SHEET DATA
End of period balances
Total loans, net of mortgages held-for-sale	$	301,775		$	234,380		28.8	%
Allowance for loan losses		4,328			3,134		38.1	%
Loans, net of allowance for loan losses		297,447			231,246		28.6	%
Securities, available for sale		60,536			40,090		51.0	%
Securities, held to maturity		250			250		0.0	%
Total Assets		398,111			306,584		29.9	%
Deposits:
Noninterest-bearing deposits		33,437			29,699		12.6	%
Interest-bearing demand and savings		73,700			60,106		22.6	%
CD’s and other time deposits		217,173			158,250		37.2	%
Total Deposits		324,310			248,055		30.7	%
Borrowed Funds		39,000			31,500		23.8	%
Trust Preferred Securities		8,764			8,764		0.0	%
Total interest-bearing liabilities		662,947			248,110		167.2	%
Shareholders’ Equity		23,719			16,637		42.6	%